04/16/2021 | Press release | Distributed by Public on 04/16/2021 04:50
Note: This announcement, originally published on 18 December 2020, has been further updated with extended effective period and a fourth option to support write off of worthless holdings. Changes have been highlighted.
Following previous Announcements A19154, A19041 and in particular A19007, Clearstream Banking1 would like to inform customers about the practical procedure supporting the removal of capital control restrictions still in place on their Icelandic assets.
Effective
4 January 2021
and until 31 December 2021, Clearstream Banking invites all customers to actively take part in the process of freeing up their Icelandic assets from capital restrictions by following the steps described in this announcement.
According to Act no. 14/2019, that came into force last March 2019, and that amends the Foreign Exchange Act, no. 87/1992, and the Act on the Treatment of Króna-Denominated Assets Subject to Special Restrictions, no. 37/2016, capital restrictions in place have been removed.
The rule no. 224/2019, on the Treatment of Króna-Denominated Assets Subject to Special Restrictions, foresees that:
Customers of Clearstream Banking willing to release the restrictions in place on their Icelandic assets are invited to proceed in accordance with one of the below procedures:
Certificate of Deposit (also revered to as ISIN IS270000027068) can be converted into foreign currencies, by simultaneously instructing a delivery against payment for the chosen position in IS0000027068 (also referred to as CBI2016), and the corresponding Forex, as per indicated guidelines.
Upon prior authorisation from the Central Bank of Iceland (CBI)2, Certificate of Deposit (also revered to as ISIN IS270000027068) can be converted into ISK cash, at a rate of 100%, by instructing the delivery against payment of the chosen position in IS0000027068.
Upon prior authorisation from the Central Bank of Iceland2, restricted securities, other than IS0000027068, can be converted into original unrestricted securities, by instructing a delivery free of payment of the chosen position in restricted assets (temporary ISIN), and an equivalent receipt free of payment of corresponding unrestricted securities (original ISIN).
List of restricted ISINs eligible for conversion into unrestricted original assets:
Temporary ISIN |
Original ISIN |
Icelandic market name |
IS0000027316 |
IS0000000388 |
MARL B |
IS0000027308 |
IS0000000040 |
OSSR B |
IS0000027282 |
IS0000020717 |
RIKB 22 1026 XX |
IS0000027233 |
IS0000019321 |
RIKB 25 0612 XX |
IS0000027241 |
IS0000020386 |
RIKB 31 0124 XX |
IS0000027175 |
IS0000020014 |
RIKS 21 0414 XX |
In addition to the above, a worthless procedure is also made available by the Central Bank of Iceland to customers of Clearstream willing to write off their restricted securities as worthless assets. No prior authorization from Central Bank of Iceland (CBI) is required.
The below table summarises the processes intended to release the restrictions on offshore Króna denominated for each of the above described option.
Concurrently instruct:
And
Instruct standard MT543 or Xact Web Portal/CreationOnline equivalent, against CBL counterparty SISLISREXXX (internal transaction):
Instruct standard MT542 (temporary ISINs) and MT540 (original ISINs), or Xact Web Portal/CreationOnline equivalents, against CBL counterparty SISLISREXXX (internal transaction):
Concurrently instruct:
Instruct free format message via MT299 to the Central Bank of Iceland (BIC SISLISREXXXX), to request remittance of worthless securities in favour of the Central Bank of Iceland:
TEXT: WE HEREBY CONFIRM OUR REQUEST TO QTY [indicate the quantity of security you wish to write off] OF ISIN [indicate the ISIN reference of securities you wish to write off] IN FAVOR OF CENTRAL BANK OF ICELAND. ALSO THE OWNER OF THE SHARES WILL NOT RECEIVE ANY MORE FUTURE PAYMENT ON THIS ONE SHARE VIA CLEARSTREAM AFTER THE WRITE OFF. THANK YOU FOR CONFIRMING YOUR ACTION.
Instruct standard MT542, or Xact Web Portal/CreationOnline equivalents, against CBL counterparty SISLISREXXX (internal transaction):
Customers of Clearstream Banking must send their instructions by every Monday 10:00 CET for intended execution within the week, on a best effort basis.
Instructions received after Monday 10:00 will be taken into consideration for the next cycle of the following Monday.
Clearstream Banking will not bear any liability should the transaction not be executed on time due to incorrect, late or invalid instructions, or missing authorisation from CBI.
Should any difficulties arise in participating to the above processes, customers are invited to contact Client Services.
Please note that customers still having encumbered balances of offshore Króna balances that result from missing disclosure on Mandatory Conversion event (see Announcement A16114) are not eligible for the above described release processes. However, customers willing to disclose can still submit their disclosure instruction per procedure in place with above mentioned event. Upon validation and processing of a submitted disclosure, Clearstream Banking will release the encumbered balances, which will then become eligible for one of the above proposed processes.
Detailed information will be provided as it becomes available.
For further information, customers may contact Clearstream Banking Client Services or their Relationship Officer.
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1. Clearstream Banking refers collectively to Clearstream Banking S.A., registered office at 42, avenue John F. Kennedy, L-1855 Luxembourg, and registered with the Luxembourg Trade and Companies Register under number B-9248, and Clearstream Banking AG (for Clearstream Banking AG customers using Creation Accounts), registered office at 61, Mergenthalerallee, 65760 Eschborn, Germany and registered in Register B of the Amtsgericht Frankfurt am Main, Germany under number HRB 7500.
2. Request for confirmation must be addressed directly to the Central Bank of Iceland by email to [email protected].
3. As per procedure described in the CBL Customer Handbook and Announcement A18106.
4. Prior authorisation from CBI is required.